Deposit & late fee

[kez1610]

Hi,

I am a newly registered childminder & I am just getting all my paperwork together. I have 2 query areas please...

1) What do you charge to secure a child's place? And do you make this refundable at the end of the childs time with you?

2) What do you charge for late payment & how much time do you give them to pay? I would like payment by the 1st of the month for fees for that month so do I charge if not received from the next day or say give them to the 5th? Also on the subject of fees do I have to invoice them? The childminder I currently use for my 2 doesn't invoice but he has averaged my payments out over the year so I pay the same every month whether there are holidays or not.

Thanks for you help.

[kelz_wilko]

i put a charge of £10 to hold a child's place and its non refundable because if they decide not to take the place i cud have given it to someone else. Parents seem to be happy with this. I also put a late payment policy together stating that a parent has half an hour after the agreed time to collect their child if they don't they are then charged at the hourly rate but for every half an hour they are late (hope that makes sense). if it goes more than 1.5 hrs with no collection then emergency contacts are contacted and then if still no collection social services are contacted. All of this is written up and put into a policy. Hope that helps.

[LauraS]

1) What do you charge to secure a child's place? And do you make this refundable at the end of the childs time with you?

I charge a deposit depending on the circumstances. Generally I ask for a deposit or four weeks/1 month in order to secure a place for a point in the future. IE more than a month ahead. The deposit is used against the first period of care. For a more immediate start I take payment for the first period of care (either a month, four weeks or if paying weekly, two weeks) on signing contracts.

I don't keep deposits until the end. The reason for this is that, in my opinion, parents would struggle to 'lose' that money in the medium/long term. To pay a months deposit plus a months care in advance would leave a full time working parent needing to find a four figure sum, potentially when having to deal with the other costs of returning to work/changing jobs/finishing maternity leave. I have balanced the risks of being left unpaid through the notice period (care is paid for upfront so no arrears unless someone disappears without giving and paying notice) versus the likelihood of lost business/revenue if parents are put of by my deposit. I'll be honest, I have been stung already for a part-timers notice period. However, I suspect that about half of my current mindees would not be with me if a deposit had been charged, so I am still better off than I would have been.

2) What do you charge for late payment & how much time do you give them to pay? I would like payment by the 1st of the month for fees for that month so do I charge if not received from the next day or say give them to the 5th? Also on the subject of fees do I have to invoice them? The childminder I currently use for my 2 doesn't invoice but he has averaged my payments out over the year so I pay the same every month whether there are holidays or not.

I started with £5 per day but have now amended this to 2%/day, so that it is a true deterrent and reflects the size of the payment which is late. I have taken the view that I cut parent some slack on the first instance of lateness (they're human after all) will remind about charges on the second instance of late payment and charge on the third. I have had to remind about charges only once, but have not had to implement the charge as yet.

[kez1610]

Thanks LauraS.

If someone books you several months in advance but then changes their mind, do you refund the deposit if they give you enough notice?

Bit unsure what to do. The childminder i currently use charges an admin fee (£25 I think) which he keeps then I think fees for the first month were owed when they are normally collected, i.e. the 1st of the month.

I like your idea of 2% of fees for a late payment charge instead of a set fee.

[LauraS]

Thanks LauraS.

If someone books you several months in advance but then changes their mind, do you refund the deposit if they give you enough notice?

Bit unsure what to do. The childminder i currently use charges an admin fee (£25 I think) which he keeps then I think fees for the first month were owed when they are normally collected, i.e. the 1st of the month.

I like your idea of 2% of fees for a late payment charge instead of a set fee.

No, the deposit is non-refundable, because in the meantime I could have either bought new equipment/resources to suit the child, or turned new business away, or both.